Retransmission Consent as Awards Show

Last Sunday was a double nail biter for Oscar enthusiasts who subscribed to Cablevision in the NYC metro area. Not only were they nervously awaiting the envelope (please) but were anxiously wondering whether they would receive the telecast at all. The 3.3 million Cablevision subscribers were the most recent victims of a retransmission consent dispute between a cable operator and the owner of a local broadcast TV station. A 1992 statute dictates that every three years a broadcast TV station must either decide whether to demand that their local cable system carry their signal without receiving compensation (called must-carry), or elect to negotiate some sort of compensation for carriage (called retransmission consent). In this case, WABC, the ABC network’s NYC affiliate, owned by the Disney Corporation, wanted Cablevision to pay Disney $1 per subscriber to carry WABC. Cablevision ran ads lambasting the greedy Disney Empire while Disney encouraged viewers to switch TV service to a satellite or telecom carrier. Early Sunday morning Disney pulled the plug on its WABC signal to Cablevision, prompting the parties to reach a tentative agreement, but not until 14 minutes into the Academy Awards broadcast when WABC’s Cablevision signal was restored.

One impetus for the must-carry and retransmission consent rules was the recognition that local broadcasting was in some way a public good — that the form of television that was locally produced and freely available for all who owned a television receiver was something worth preserving. Must-carry and retransmission consent were policies to ensure that local broadcasting would remain economically viable as cable and satellite forms of nationally distributed programming expanded – they were meant to provide local broadcasters with some measure of leverage in contract negotiations with cable operators. But when media conglomerates grew to own TV stations, broadcast networks, cable networks and other media properties, the must-carry/retransmission rules became tools for leveraging corporate power in carriage negotiations. In the 1990s, FOX used retransmission consent to get cable operators to carry its FX cable network, ABC did so to leverage ESPN2, and NBC leveraged CNBC. More recently, in addition to leveraging carriage of conglomerates’ non-broadcast networks, retransmission consent disputes have negotiated direct per subscriber fees for broadcast TV carriage. For example, FOX negotiated per subscriber fees for its owned and operated broadcast TV stations while other large multi-station groups, such as Sinclair, have obtained per subscriber payments for their broadcast stations as well. With more precedents for per subscriber fees for broadcast TV station carriage, cable and satellite operators have formed a group to lobby the FCC to arbitrate these disputes and prevent broadcasters from pulling their signals during contract negotiations.

But rather than push these public disputes behind closed doors, perhaps now that we, the subscribers, are in effect paying directly for local broadcast TV, perhaps we should have more say about programming decisions and corporate practices. If corporate conglomerates used the privilege of retransmission consent (a policy derived from the foundational principle that the airwaves are a public resource) to leverage their corporate interests in negotiations, why can’t we, the subscribers, use this policy to leverage our demands for more corporate transparency and voice in programming decisions.

Well, for inside-the-beltway folks this would be just silly. But we can imagine, and even begin to organize, a way to make these retransmission consent disputes more publicly relevant beyond missing Alec Baldwin and Steve Martin’s 14 minutes of opening shtick. As the next retransmission consent dispute inevitably looms (quite possibly to a neighborhood near you), perhaps what we need is a Retransmission Consent Awards Show that allows viewers to express their viewing desires and hold the conglomerates accountable for their corporate practices. Let the subscribers have a voice in terms of how their money is allocated, to decide which corporate entity is more worthy of compensation.

An Awards Show for this latest dispute would have subscribers vote for least egregious practices in compensating executives, or for records on labor relations, another for merchandising practices and perhaps one for campaign contributions. The Show might include dramatic reenactments of corporate activities, such as when Disney pressured the Harvard-affiliated Judge Baker Children’s Center to evict the Campaign for a Commercial-Free Childhood after the advocacy group proved Disney’s Baby Einstein videos had no educational value and persuaded Disney to refund customers who purchased these videos. There might be a sports award that allowed viewers to comment on how Disney’s ESPN and the Dolan’s MSG franchises cover sports. I for one miss ESPN’s Playmakers, the scripted show that was critical of NFL culture and, likely, why it was short lived. I’ve also become a fan of women’s softball, but get tired of waiting until the Olympics to watch it on TV (which is no longer the case since softball was dropped from the 2012 games). Indeed, perhaps others would want more coverage of women’s sports in general from these conglomerates, especially given ESPN charges cable systems close to $4 per subscriber for carriage. Cable subscribers might also have something to say about how much their per subscriber fee for a local broadcast channel actually gets allocated to the local station, rather than to the station’s affiliated network or conglomerate. I watch local TV news in the morning (and indeed, studies show that local TV news is still the leading media source for news) and enjoy the weather reports and puff pieces on community events from dog shows to what not. But I would appreciate it if the station had more investigative personnel to cover city hall and local commerce — as I’m sure local news producers would like more resources to do so as well.

It’s our airwaves and increasingly our direct payments. What would other subscribers like to see exposed, talked about and shared in the coming retransmission disputes?

5 Responses to “ Retransmission Consent as Awards Show ”

Excellent post, John. As you note, the position of the audience/consumer/citizen in all this should be key, even though at present we’re reduced to simply waiting to see what happens and to choose whether to watch what they give us or not.

I love your idea of an awards show, albeit it tongue-in-cheek, since ideally it would serve an informational purpose. Just as most of the country hadn’t heard of The Hurt Locker till it got all the Oscar buzz, most of us have no sense of how our cable dollars are being parsed out. Indeed, do you know of a site or organization that tracks exactly how much each channel is charging, what’s must-carry, etc.? Seeing such a list would seem to be Step One in determining what battles could be fought.

John, I really enjoyed this post. The battle over retrans has been heating up in the past year or so and it looks like it will remain contentious. I think this has a lot to do with anxiety in the television industry over changing business models–the networks are trying to find money anywhere they can get it. You also make a great point that the consolidation of media ownership has allowed broadcasters to leverage their various holdings to get higher carriage fees from MVPDs.

There’s some buzz about allowing cable subscribers to assemble their channel lineup a la carte. It’s only a matter of time until the distribution technologies can handle that kind of customization, but consumers may face higher cable fees if they don’t benefit from bundling deals negotiated by MVPDS. This fall, Apple seemed to be putting together a plan where users would be able to subscribe to individual programs or a “best of TV” package for $30/month. Would individualized channel lineups be a good way to make sure consumers got access to the programming they demanded? Could broadcasting still serve the public good if we were to adopt individualized cable subs?

To Jon’s question–I haven’t found any places where those kinds of negotiations are available. I’ve only found them leaked out piecemeal in the press. There is a new SNL Kagan report out about the biggest overlaps in cable and broadcast ownership by MSO. It basically predicts where the next retrans battles will play out: http://www.snl.com/InteractiveX/article.aspx?CDID=A-10776008-12593

John McMurria on March 25, 2010 at 4:33 PM

Sheila, you’re right that there has been much debate in recent years about a la carte. Despite the highly bipartisan climate in Washington these days, support for a la carte has come from Democrats and Republicans in recent congressional hearings. However organizations representing what has been called the rainbow coalition are against a la carte. They fear that networks that target underrepresented groups would be hurt by a la carte pricing and benefit the networks that get larger ratings. We might also be concerned about losing a space where diverse voices can speak to broader audiences. This is typically the purview of a vibrant public broadcaster, but since we don’t have that, we might be reluctant to support further balkinization in viewing. I elaborated a bit more on this in an issue of flow: http://flowtv.org/?p=219. Perhaps there are other ways in new media environments to facilitate more cross cultural encounters.

Particularly of note to sports programming is Sports Fans Coalition’s filing before the FCC yesterday seeking the FCC to rule that programming may not be withheld in these very public retrans consent negotiations.